Modi's AI Spectacle: Chaos and Deception in New Delhi

The India AI Impact Summit 2026, held at Bharat Mandapam in New Delhi, has been marred by chaos, confusion and deception. The events on the ground have produced unintended media headlines for India's Prime Minister Narendra Modi who wants to be seen as the "vishwaguru" (teacher of the world) in the field of artificial intelligence as well. First, there was massive chaos on the opening day, with long lines and sudden unannounced evacuation of exhibitors and attendees from the show floor for several hours. This, the Indian government said, was done for "VIP" security, a euphemism for Mr. Modi's "photo op" as he walked the venue halls alone for the benefit of the cameras for self-promotion. Mr. Modi then declared that "India is not just a part of the AI revolution, but is leading and shaping it". To support such claims, an Indian University presented a "robodog" bought from China as its "innovation", a blatant lie that was immediately caught by people on the social media, leading to the expulsion of the institution from the show. 

5-Layer AI Stack

Let's examine Mr. Modi's claim to be "leading and shaping" the AI revolution. The artificial intelligence technology is a 5-layer stack, consisting of energy, AI chips, infrastructure, AI models and applications. Only two nations, the United States and China, have their own full 5-layer stacks. It's hard to see India as leading in any one of these layers. 

Currently, the AI space is dominated by China, the US and a handful of hyperscalers like Amazon, Google, Microsoft, etc. Any country wanting to jump on the AI bandwagon has to choose between the American and Chinese giants. Bloomberg put it best as follows:

"This, fundamentally, is a matter of sovereignty: Whether a nation’s AI systems can be independent of foreign authority. That danger was showcased in 2024, when members of Australia’s UniSuper pension fund had access to their accounts cut off due to a Google cloud misconfiguration. In October, Amazon.com Inc.’s cloud services — the world’s largest — also suffered a major shutdown, damaging its reputation". 

Strict security restrictions at the Indian AI summit caused significant limitations on carrying personal items, including laptops and other electronic devices.  In spite of such "strict security", some participants reported their exhibits and personal items stolen at the event. The fact that only cash was accepted for food and other services at the venue for the AI Summit makes a mockery of the Modi government's hype about India's digital public infrastructure (DPI). 

India's Galgotias University of Uttar Pradesh Showed Chinese Robodog as its Own

There is a significant presence of Americans at the AI Summit in New Delhi. Major "hyperscalers" like Anthropic, Google and OpenAI and Microsoft executives are all attending. The American agenda at the conference was put very succinctly by Sriram Krishnan, Senior White House Policy Advisor on Artificial Intelligence, who said, "...We want to make sure that the world uses the American AI stack...We also want the world to use our AI model...We want all our allies, including India, to leverage our AI infrastructure."

Major US technology firms have announced plans to build large multi-gigawatt AI data centers in India that make enormous demands on energy and water for powering and cooling the energy-hungry beasts. They are facing strong resistance in US cities and towns because of concerns that they will divert precious water and power, increase the rates they have to pay and cause pollution. India appears to be welcoming them for the investment they bring, in spite of significant health and safety concerns. But the Americans will not guarantee "data sovereignty" to the Indian government for Indian consumers' data stored in these data centers. 

President Donald Trump has recently scrapped greenhouse gas emission regulations to enable the use of fossil fuels to power AI data centers in the United States. But the local opposition by cities and towns continues to gather steam. 

Views: 1367

Comment by Riaz Haq 10 hours ago

Keji Mao (毛克疾）
@kejimao
The Japan Times writes, "India stands out as one of the biggest losers as the artificial intelligence trade reshapes global investment flows." It is quite surprising that even a major Japanese newspaper speaks out about this loudly. But the truth is Japan may well be in an even worse position when it comes to AI.

https://www.japantimes.co.jp/business/2026/05/17/india-missing-out-...

https://x.com/kejimao/status/2056269461955776653?s=20
-------

India missed out on AI and now its run as market darling may be over

https://www.japantimes.co.jp/business/2026/05/17/india-missing-out-...

In a stark shift, the country’s stock market is on the verge of dropping out of the world’s five biggest for the first time in three years. Without the AI-driven rallies powering Taiwan and South Korea, there’s a growing risk that India falls further behind rather than regaining lost ground.

The rationale goes far beyond Indian equities being relatively expensive or corporate earnings slowing. Global investors, who not long pushed India close to rivaling China in emerging-market portfolios, are now chasing themes the country’s market largely lacks: chip manufacturing, computing infrastructure and AI models. While India has talent, demand and digital scale, few of its corporate champions are directly linked to that buildout. That increasingly leaves the market tied to the domestic consumption story.

“This isn’t a dip you buy,” said Gary Dugan, chief executive of Global CIO Office. “What markets haven’t fully priced yet is that this isn’t an earnings miss story in India, it’s a terminal value story. The assumptions about where these businesses are in 10 years have to change.”

Underscoring the scope of the revaluation, India’s weight in the MSCI emerging markets index has fallen to about 12% from 19% last year. Roughly two-thirds of the reallocation from India over the past 12 to 18 months reflects AI positioning, according to M&G Investments.

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India Misses Out on AI: Stock Market Close to Falling From Top 5 as AI Trade Favors Taiwan, Korea - Bloomberg

https://www.bloomberg.com/news/articles/2026-05-17/india-missed-out...

Takeaways by Bloomberg AI

India's stock market is on the verge of dropping out of the world's five biggest for the first time in three years due to the artificial intelligence trade reshaping global investment flows.
Global investors are chasing themes that India's market largely lacks, including chip manufacturing, computing infrastructure, and AI models, leaving the market tied to the domestic consumption story.
India's weight in the MSCI emerging markets index has fallen to about 12% from 19% last year, with foreign investors abandoning India at an accelerating pace and holding less than domestic institutions for the first time in more than 20 years.
India stands out as one of the biggest losers as the artificial intelligence trade reshapes global investment flows.

In a stark shift, the country’s stock market is on the verge of dropping out of the world’s five biggest for the first time in three years. Without the AI-driven rallies powering Taiwan and South Korea, there’s a growing risk that India falls further behind rather than regaining lost ground.

The rationale goes far beyond Indian equities being relatively expensive or corporate earnings slowing. Global investors, who not long pushed India close to rivaling China in emerging-market portfolios, are now chasing themes the country’s market largely lacks: chip manufacturing, computing infrastructure and AI models. While India has talent, demand and digital scale, few of its corporate champions are directly linked to that buildout. That increasingly leaves the market tied to the domestic consumption story.

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